In a report in industry newspaper, Money Marketing, speculation abounds that a report on the new style simple charge financial products by B&W Deloitte, should be capped at 2% pa. The Stakeholder Suite of products is this Government's answer to simplifying financial products by allowing them only to have one charge and no penalties. This review was organised by the Treasury with Ron Sandler at the helm.
Our view:
Speculation, but if true, it is a complete "cop out". 2% pa charges on a policy is much higher than many current policies. This type of charge would just be bowing to pressure from providers so that they can pay more commission or make more money themselves. Sandler should stick to the 1% pa charge as set in Stakeholder rather than this deflated message to the public. The only reason many want charges to be higher is so that they can make more money via that back door. At , we agree a maximum fee or commission with a client, before giving any advice - so whether the charges are higher or lower or commissions are greater or less, it is immaterial to us as we have already agreed a cost! It is a shame more in the industry do not work our way.